The stringent requirements of banks and the delay in releasing funds have made them impractical for investors and developers looking for commercial property loan deposit.
Consequently, non-bank financing providers have become a more viable option. With fast processing and non-stringent requirements, they release soft deposits on time. Such timely access to funds is essential, especially for investors in competitive markets.
In this article, we consider five such financing companies you can consider for your next soft deposit financing.
-
Duckfund
Duckfund is a financing company that provides soft deposit financing as well as equity and debt financing for new, renovation, and value-add projects.
Best known for:
Duckfund is best known for the flexibility of its deals.
Key advantages:
- Fast approval and funds disbursal: You can complete an application in 2 minutes and get the funds transferred to an escrow within 48 hours of approval.
- Flexible deals: While the minimum amount is $50,000, there is no maximum. Also, Duckfund will provide larger soft deposits for developers and investors in competitive markets.
- Discount for developers: After the fourth month of the due diligence period, developers will pay a discounted fee from what they paid in the first three months.
- Transparent fees: Duckfund charges low and transparent standard rates per 30-day period, with discounts applied at the 4th month.
- Multiple simultaneous deals: Investors and developers can apply for multiple deals at the same time.
Ideal for:
Duckfund is appropriate for investors and developers in competitive markets.
-
CREI Funding
CREI Funding is a private money lender that offers soft deposit financing, fix and flip loans, construction loans, bridge loans, developer loans, and DSCR loans, among others.
Best known for:
CREI Funding is best known for its fast and flexible soft deposit financing.
Key advantages:
- National coverage: CRE developers and investors across the US can get soft deposit financing, except those in Utah, Kansas, California, Hawaii, and Vermont.
- Flexibility: Though there is a minimum amount of $25,000, there is no maximum amount. However, any amount above $1 million will require extra scrutiny.
Also, the minimum timeframe for the funding is 30 days, but there is no maximum.
Finally, the call option premium is flexible, based on the amount of the soft deposit and the duration.
- Fast approval and disbursal: New applications are approved within 24 hours, and funds are disbursed within 48 hours.
- Accessibility: The only required document is an unsigned PSA. The only stringent condition is that the investor or developer must work with one of the top 10 title companies in the nation.
Ideal for:
CREI Funding is ideal for developers and investors looking for fast and flexible deals.
-
Solon Management Group
Solon Management Group (SMG) is a real estate lending company that offers a variety of financing programs, including rental DSR funding, fix and flip loans, new construction loans, down payment assistance, cash out refinance, and soft deposit financing.
Best known for:
SMG is best known for its fast approval process.
Key advantages:
- Flexible: There is no minimum or maximum deposit requirement. SMG will entertain any financing request, irrespective of the size.
- Fast approval: They approve a funding request and disburse funds within 24 hours.
- Simple application process: The application process can be completed in minutes.
Ideal for:
SMG soft deposit financing is appropriate for investors and developers seeking soft deposits for very small or very large amounts.
-
Winchester Equities
Winchester Equities is a real estate investment and financing firm that offers soft deposit financing as well as equity and debt financing for new projects and off-market acquisitions.
Best known for:
Winchester Equities is best known for supporting big real estate projects that require high soft deposits.
Key advantages:
- Flexible time frame: Winchester Equities supports 30, 60, and 90-day financing timeframes.
- Accessibility: They require no credit check or collateral. However, there are multiple fees (2.5% option premium, legal fee, and exercise premium) that can easily add up.
- No maximum deposit: The minimum deposit is $500,000, but there is no maximum.
Ideal for:
Winchester Equities is ideal for developers and investors dealing with massive projects that require significant soft deposits.
-
AdvanceDeposit
AdvanceDeposit is a financing company that provides only soft deposit financing for real estate developers and investors.
Best known for:
AdvanceDeposit is best known for its low financing fees.
Key advantages:
- Low fees: Its 1% financing fee per 30-day period is low. But there are additional legal and processing fees with no specified rate.
- Flexibility: There is no stated limit to the financing timeframe. Also, the funding amount ranges from a minimum of $50,000 to a maximum of $20 million, large enough to support different investors’ needs.
- Accessibility: No collateral or credit check required.
Ideal for:
AdvanceDeposit is ideal for developers and investors who desire flexible financing terms.
Duckfund seems to provide the best combination of features. Its standard fees are low, and there are no multiple charges. It disburses funds quickly while supporting a time frame as long as 90 days.
More importantly, it supports developers in competitive markets by providing higher amounts and allowing them to make funding requests for multiple properties.